Aipedia: Will writers and estate planners

AI trust drafting and inheritance tax planning for will firms

Aipedia, by the Apex broking team · Last reviewed 2026-10-30

AI can draft trust clauses and inheritance tax notes quickly, but unchecked output risks a trust that fails its purpose or an unexpected tax bill. These errors often surface only on death or many years later, when they cannot be corrected.

Part of: AI in Will writers and estate planners

In short

Will firms use AI to draft discretionary will trusts, life-interest trusts, property protection trusts and short inheritance tax (IHT) planning notes. Generative tools can produce confident but wrong tax statements, mix trust types, or omit powers trustees will need. The codes require members to stay within their competence and refer work beyond it. Advice on investments or insurance products can be FCA-regulated, and complex tax work may need a tax adviser. PI usually responds to negligent trust drafting, subject to the wording, but some policies limit tax or financial advice.

How AI is used in trust and IHT work

Trusts are where will writing becomes estate planning. Firms use AI tools to produce trust clauses in wills, to draft standalone lifetime trust deeds, to explain to clients how a life-interest or discretionary trust might work, and to generate summary notes on how a plan might affect inheritance tax. Some tools produce whole "estate planning reports" from a short fact find.

These outputs sound authoritative, which is the risk. Tax rules change, allowances have conditions, and the tax treatment of a trust depends on its exact type and terms. A tool trained on general text may state a rule that is out of date, from another country, or applied to the wrong kind of trust.

The duties that apply

IPW Code clause 2.6 says members must not take on work beyond their competence, and SWW Code clauses 2.3 to 2.5 require competence, CPD and referral of work beyond it. SWW clauses 4.1 to 4.3 require a written summary of instructions, recommendations and prices, so any AI-generated recommendation that reaches the client becomes the firm's recommendation.

Will writers are not generally regulated, but some services fall within FCA regulation. Recommending investments or insurance products, for example as part of a trust plan, may be a regulated activity that requires authorisation. Firms without it should refer to an authorised adviser. Complex IHT planning may need a tax specialist; see AI in inheritance tax planning for tax advisers.

What can go wrong

A trust clause that mixes discretionary and life-interest features, so its tax treatment is uncertain.
Missing trustee powers, such as powers to sell, invest or advance capital.
An IHT note that overstates a relief or assumes it applies without checking its conditions.
A property protection trust that does not achieve what the client expected on second marriage or care.

Illustrative scenario: a firm uses a generative AI chatbot to draft an IHT planning note for a widower with a business interest and a family home. The note says a relief will apply in full and recommends a will trust. After his death, the executors' adviser finds that the conditions for the relief were not met and the trust structure triggers a larger tax charge than expected. The beneficiaries claim the difference from the will firm.

How PI usually responds

Negligent trust drafting is usually within will-writer PI as part of the firm's professional services, subject to the £2 million minimum under IPW clause 1.7 and SWW clause 2.12 and to the policy terms. Tax and financial advice can be treated differently. Some wordings exclude or limit tax advice, investment advice, or work outside the described business, so a firm that has drifted into estate planning reports may find its proposal form did not describe them. Care-fee planning raises related issues; see AI and care-fee asset protection planning.

Practical controls

Limit AI to first drafts of standard trust clauses your firm has approved.
Never send an AI-generated tax statement to a client without a qualified person checking it against current law.
Set a referral threshold for business assets, agricultural property, foreign assets and large estates.
Refer any investment or insurance product recommendation to an authorised adviser.
Describe estate planning and trust work accurately on your PI proposal form.
Record the client's objectives so the trust can be judged against them later.

Checking drafts against instructions is covered in AI will drafting software.

How Apex helps

Apex arranges PI for estate planners and can review whether your policy covers trust and IHT planning work as you actually do it. See AI in will writing, does PI cover AI errors and estate planner insurance.

Sources

Frequently asked

Can a will writer use AI to give inheritance tax advice?

AI can help prepare a draft, but the will writer is responsible for anything sent to the client and must stay within its competence under the codes. Complex or high-value planning should be checked by, or referred to, a tax specialist.

When does estate planning become regulated advice?

Recommending investments or insurance products can be FCA-regulated activity. A will writer without authorisation should not make those recommendations, whether a person or an AI tool generates them, and should refer the client instead.

Does will writer PI cover trust drafting errors?

Usually, if trust drafting is part of the declared professional services. Some policies limit tax or investment advice, so check how your wording treats estate planning reports and IHT notes.

Is it safe to paste a client’s estate details into a public AI tool?

Estate details include personal and often health and family data. IPW clauses 5.1 and 5.2 and SWW clause 2.8 require confidentiality and data protection compliance, so use an approved business tool with suitable terms, or anonymise the facts first.

Check your PI covers how you use AI

Tell us about your firm and the work you do. A broker will review how your current PI treats AI-assisted work, or arrange new cover. No fee for a quote. Or call 0117 325 0027.

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Apex Insurance Brokers Limited is authorised and regulated by the Financial Conduct Authority. Registered in England and Wales, company number 07014570. This page is general information about how AI is used in the profession and how insurance may respond. It is not legal, regulatory or insurance advice on your circumstances, and it does not guarantee that cover will be available or on what terms.